BNP Paribas has entered the competitive Hong Kong retail market with the launch of a credit-linked structure and is planning additional products across asset classes. "There [are] certainly a lot of players, but there's still a lot of potential and a lot of money in the retail world to be allocated to good products," said Stephen Sze, head of the third-party distribution group in Hong Kong.
Sze joined from Deutsche Bank earlier this year to develop the firm's retail business in the region. The group, which is a joint venture between the fixed income and equity departments, plans to offer structured products on credit, equity, fx, commodity and interest rates and hybrids. "Ideally we'd like to do 10-15 products a year in Hong Kong," continued Sze, noting he is already in talks with local distributors for a follow-up note issue.
In the debut credit-linked structure--dubbed Elite Series 1--the note is referenced to a basket of six international companies including American Express and Hutchison Whampoa. With a maturity of five and a half years and two semi-annual payments, two tranches are available, one in U.S. dollars offering 5% per annum and a tranche in Hong Kong dollars offering 4.55%.
